In recent years, the damage caused by natural disasters has increased worldwide; this trend will only continue with the impact of climate...

Title: Managing Extreme Climate Change Risks through Insurance

Author: Dr. W.J. Wouter Botzen

Publisher: Cambridge University Press

In recent years, the damage caused by natural disasters has increased worldwide; this trend will only continue with the impact of climate change. Despite this, the role for the most common mechanism for managing risk – insurance – has received little attention. This book considers the contribution that insurance arrangements can make to society’s management of the risks of natural hazards in a changing climate. It also looks at the potential impacts of climate change on the insurance sector, and insurers’ responses to climate change. The author combines theory with evidence from the rich experiences of the Netherlands together with examples from around the world. He recognises the role of the individual in preparing for disasters, as well as the difficulties individuals have in understanding and dealing with infrequent risks. Written in plain language, this book will appeal to researchers and policy-makers alike.

Advance praise: ‘Are insurers the victims, the virtuous or the villains of climate change? W. J. Wouter Botzen’s book questions how a global business is going to cope when long-held assumptions are challenged by a changing climate. Yet insurers have proved to be innovators with a unique means of communicating risk to householders and businesses worldwide … via the prices they have to pay for insurance contracts. Botzen’s book demonstrates how insurers have a crucial role to play in the management of risk in a changing world.’ Jim W. Hall, Professor of Climate and Environmental Risks, University of Oxford

Advance praise: ‘Rapidly changing climate combined with growing exposure in high risk areas is likely to trigger more extreme events around the world in the coming years. Based on sound economic analysis in the Netherlands and other countries, this book provides an advanced analysis of what challenges and opportunities this creates for insurers, governments and those who want to be financially protected. W. J. Wouter Botzen is one of the most insightful scholars of his generation in this field.’ Erwann Michel-Kerjan, Professor and Managing Director, Wharton Risk Center, The Wharton School of the University of Pennsylvania; Chairman of the OECD Board on Financial Management of Catastrophes

Advance praise: ‘This marvelous book, written in the Netherlands which is famous for taking land from the sea, makes Nobel-awarded risk theories tractable for managing water damage and climate change. It is a must-read for researchers and managers of risks of natural disasters.’ Peter P. Wakker, Professor of Decisions Under Uncertainty, Erasmus School of Economics, Erasmus University, Rotterdam